Legislature(1999 - 2000)
03/07/2000 09:45 AM House FIN
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
March 7, 2000
9:45 A.M.
TAPE HFC 00 - 60, Side 1.
TAPE HFC 00 - 60, Side 2.
TAPE HFC 00 - 61, Side 1.
CALL TO ORDER
Co-Chair Mulder called the House Finance Committee meeting
to order at 9:45 a.m.
PRESENT
Co-Chair Mulder Representative Foster
Co-Chair Therriault Representative Grussendorf
Representative Austerman Representative Moses
Representative Bunde Representative Phillips
Representative J. Davies Representative Williams
Representative G. Davis
ALSO PRESENT
Representative Carl Morgan; Nancy Slagle, Director, Division
of Administrative Services, Department of Transportation and
Public Facilities; Joseph Perkins, Commissioner, Department
of Transportation and Public Facilities; Larry LaBolle,
Staff, Representative Foster.
SUMMARY
HB 312 An Act making and amending appropriations for the
operating and loan program expenses of state
government, for certain programs, and to
capitalize funds; making appropriations under art.
IX, sec. 17c, Constitution of the State of Alaska,
from the constitutional budget reserve fund; and
providing for an effective date.
HB 312 was HEARD and HELD in Committee for further
consideration.
HB 313 An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing
for an effective date.
HB 313 was HEARD and HELD in Committee for further
consideration.
AMENDMENTS HEARD:
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES
HOUSE BILL NO. 312
An Act making and amending appropriations for the
operating and loan program expenses of state
government, for certain programs, and to capitalize
funds; making appropriations under art. IX, sec. 17c,
Constitution of the State of Alaska, from the
constitutional budget reserve fund; and providing for
an effective date.
HOUSE BILL NO. 313
An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing for
an effective date.
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES
Representative Austerman MOVED to ADOPT DOT#1. [Copy on
File]. Representative Grussendorf OBJECTED. Representative
Austerman explained the amendment.
DELETE
BRU: Administration and Support Component:
Commissioner's Office Delete $119.5 in general funds, the
Deputy Commissioner Position.
ADD
BRU: Highway and Aviation Component
Central Region
Add $100.0 in general funds for the Kalsin Bay Maintenance
Station, which would restores two heavy equipment operator
maintenance positions. Two positions are required to safely
and sufficiently operate this station. Restoration of these
funds would allow for the adequate road maintenance on the
Chiniak Highway from Middle Bay (Milepost 20) to Chiniak
(Milepost 42). These positions would also restore service on
the Pasagshak Highway from the "Y" (Milepost 00) to Narrow
Cape Coast Guard Loran Station (Milepost 16). There are
approximately 150-200 people living on these 2 road systems
who are receiving limited service.
Representative Austerman noted that there is limited road
maintenance serving the Kodiak Launch Complex at Narrow
Cape. Lack of service and response time has created a
hardship for the industry in the transportation of delicate
equipment to the launch site, and many of the vital support
services to residents and the launch complex have also been
severely impacted.
ADD:
BRU: Public Communication Services Component:
Public Broadcasting -Radio
Add $19.5 in general funds for Public Radio
Representative Grussendorf agreed that there should be
funding allocated for the road project, however, the
deletion to the Office of the Commissioner would not be in
the best interest for that Department.
JOSEPH PERKINS, COMMISSIONER, DEPARTMENT OF TRANSPORTATION
AND PUBLIC FACILITIES, explained that last year's discussion
with the House was a $1 million dollar cut to the budget to
all maintenance stations. When the budget went to the
Senate, the Department received an unallocated cut of $2
million more dollars. The total cut was in the amount of
$3.8 million dollars which resulted in the closure of five
stations.
Co-Chair Mulder advised that the net reduction had been $1.2
million general fund dollars. Commissioner Perkins
explained that the difference between last year's budget and
the current one was $3.8 million general fund dollars. He
reiterated that there was $3.8 million dollars less.
NANCY SLAGLE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES,
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES, agreed
with comments made by the Commissioner. She referenced a
reduction which the Department had absorbed in the Capitol
Budget last year in deferred maintenance areas. She
stressed that work needs to be done in order to maintain
these highways.
Commissioner Perkins interjected that the cuts were taken
from both from the capital and operational budget from the
previous year. He re-emphasized the seriousness of the
budget crisis existing within that Department.
Co-Chair Mulder asked who requested the reclassification.
Commissioner Perkins replied that reclassification had been
part of the labor negotiations from a few years ago. The
re-class study was run as a normal study and created an
increase in costs. Commissioner Perkins shared the
Committee's frustration, however pointed out that this
budget will move from this Committee to the other Body,
where more deductions will be made.
Commissioner Perkins itemized the services provided by the
Department. He referenced the impact of cutting the
recommended jobs. Commissioner Perkins pointed out that the
Department runs a $800 million dollar program. The
maintenance program is run with eight authorized slots in
the Commissioner's Office. The Subcommittee cut $100
thousand dollars out of that office. One of those slots is
vacant and remains vacant so to be able to use in
consideration of the vacancy factor. The cut proposed would
be 20% to that Office. Commissioner Perkins emphasized the
amount of work it takes for the current number of staff to
run this State operation as recommended. He stressed that
it can not be done with the proposed staff size. He
outlined the roll of the Deputy Commissioner, which is a
valuable position for the Department. He reiterated that
the Department is as "thin as it can get" to do the
management requested.
Representative Williams spoke to agreements made at the
Subcommittee level. He wanted these issues to be addressed
and noted that the proposed reductions had been passed
through the Office of the Commissioner.
Representative Austerman countered that when the maintenance
station was closed in Kodiak, there was no discussion. Co-
Chair Mulder asked if the Kodiak station was closed.
Commissioner Perkins replied that it is closed, however,
there is a sand pile and loader in that location. He noted
that there is no person assigned to that location at this
time. Representative Austerman explained that currently,
there is a man living in that area. Commissioner Perkins
explained that for safety reasons, a station can not be open
without two employees. He pointed out that this savings is
also cutting down the overhead. The cuts proposed to the
Subcommittee were cuts to the stations. Fixed costs are
"killing" the Department. He reiterated that there are not
enough people to do the work. He added that he intended to
close maintenance stations this year to save the fixed
costs.
Representative Williams emphasized that the Subcommittee had
attempted to address the concerns of the Department with no
recourse to that agency. He noted that Commissioner
Perkin's office supplied the "proposed laundry list".
Commissioner Perkins countered that the "body" of the list
was not too far off. He proceeded to list the items the
Department did to meet the budget caps.
Representative Williams acknowledged that it was difficult
to make reductions to that Department. He wished that this
discussion had occurred at the Subcommittee level.
Representative Grussendorf encouraged an unallocated cut
"option" for the Commissioner. He stated that it would not
be in the State's best interest to cut the Deputy
Commissioner position in order to support the amendment.
Co-Chair Mulder inquired the expected savings from closing
the maintenance station in Kodiak. Ms. Slagle replied the
savings would amount to about $100 thousand dollars.
Commissioner Perkins interjected that five maintenance
stations had been closed and he stated that he did not like
making those closures.
Co-Chair Mulder questioned how the road was being
maintained. Commissioner Perkins replied that is happening
out of the maintenance station in Kodiak and that the
service level is less than it was before.
Representative Austerman maintained that the maintenance
level is not good enough and that Kodiak can not continue
with that level having the boat launch and its condition.
Representative J. Davies stressed that the fundamental issue
is that when budgets are reduced, services drop off. He
stressed that the action is not fair, and that the proposal
is to place this "on the back" of the Commissioner. He
disagreed that the Commissioner can do a good job with only
three managers through his office. He emphasized that
management is a responsible consideration and that the
Department is expected to spend their money wisely.
Representative J. Davies emphasized that is ludicrous given
the size of that Department.
Representative J. Davies MOVED to DIVIDE the question,
addressing the DELETE and the two ADD's separately. There
being NO OBJECTION, the amendment was divided into 1.1, 1.2
and 1.3.
REPRESENTATIVE CARL MORGAN voiced his frustration regarding
the impact statements provided by Department of
Transportation and Public Facilities. He noted that the
cuts proposed by the Department would heavily affect the
Bush area, particularly his District, #36.
(TAPE CHANGE, HFC 00 - 60, Side 2.)
Representative G. Davis commented that there are problems in
each district. He agreed that the essence of the amendment
was good. He questioned the number of statewide area
airports which would be affected. Representative G. Davis
pointed out that he is protective of any cuts to road
maintenance. He urged the Committee to reduce new
construction and planning before touching road maintenance.
Representative Foster commented that he did not support the
division made by the amendment and noted that he objected.
Representative Austerman asserted that he did not care where
the money comes from but that it was imperative that the
station be reopened.
Representative Moses interjected that this request is a
"glaring" example why the State should not be maintaining
roads. Funding should be allocated to each region and then
local governments can be responsible to maintain their
roads. Representative Foster agreed.
Representative Austerman requested that the amendment be
HELD and addressed directly by the Department.
Representative Austerman MOVED to HOLD the divided
amendment. There being NO OBJECTION, the amendment was
"tabled" for further consideration. .
Representative Foster MOVED to ADOPT Amendment DOT-1A. [Copy
on File]. Representative J. Davies OBJECTED for the purpose
of discussion.
DELETE:
BRU:
Highways and Aviation
Component: Northern Highways and Aviation
DELETE:
$257.6 in general funds, Northern Highways and Aviation
ADD:
BRU (New): Statewide Highways Snowplowing & Winter
Maintenance Component: Statewide Highways Snowplowing &
Winter Maintenance
ADD:
Spring opening of
Taylor Highway $132.0
McCarthy Road 8.7
Boundary Spur 10.5
Nome/Teller Road 35.7
Nome/Council Road 34.7
Kugarok Road 36.0
Representative Foster pointed out that the amendment would
move funds currently in the recommended budget for Northern
Region Highways and Aviation and would place them into a
separate BRU so that the funds cannot be used for another
purpose. For the last two fiscal years, spring opening for
these and other roads had been eliminated so that funds
could be used for other purposes. The amendment has
necessitated adding funds in the Supplemental Budget for the
opening of the roads to meet the needs of the tourist and
mining industries.
Representative Foster advised that all of these routes are
of economic importance. The mining and tourist industries
depend upon a scheduled opening of these roads for planning
purposes. If roads are allowed to melt without some manual
assistance, it is impossible to schedule tours or planned
activities.
He added that the economic impact of delayed openings is
severe since both the mining and tourist industries have
limited seasons. Shortening the season significantly reduces
income for people dependent on these activities.
Representative Foster concluded that in the case of Nome, to
wait for the roads to melt will completely eliminate much of
the bird watching activity which corresponds to the spring
migrations of several species of birds that are normally
found only in Asia.
Representative Grussendorf spoke to moving some funds from
the Northern component and consequences that could create.
Commissioner Perkins pointed out that would be an additional
cut to the Northern Region. Ms. Slagle explained that the
Subcommittee had added $260 thousand dollars for aviation in
the Northern region. That was offset by reductions to the
Commissioner's Office, the Division of Administrative
Services, information systems, and the support services in
the three regional offices. The impact would be the
elimination of 1.5 positions in the Commissioner's Office
and 3 positions in the Division of Administrative Services.
Representative J. Davies clarified that the money had been
reallocated from within. Representative Morgan spoke in
support of the amendment. He reminded members how much it
costs to replace the culverts and wash outs in the road
system. Commissioner Perkins replied that the cost of
fixing the roads will not be that much. The total road
portion would not be lost. He stated that it would keep the
roads softer for longer by doing the work. Commissioner
Perkins pointed out that this would be the least impact for
cutting. He commented that he did not support any of the
cuts. The Commissioner cautioned the Committee of cuts to
the administrative side of the Department.
Representative Phillips spoke about the reality of not
opening the Nome-Council Road. She emphasized that the
Committee can not do that to the road system throughout the
State; it would take Alaska back to the 1950's.
Representative Williams emphasized that the Department
agreed to this in the Subcommittee. He noted that other
areas were cut to fund this for the overtime and snow
removal costs. He indicated that he did not agree to
"unallocated" cuts.
Representative J. Davies agreed that concerns voiced before
the Committee were legitimate. He commented that the action
recommended by the Committee is in effect an unallocated
reduction. He questioned where the reductions would come
from. Representative J. Davies noted that the problem is
that the Committee is establishing priorities that do not
encompass the whole picture. There are issues of
maintenance throughout the State which are not being
addressed. He noted that he could not support the proposed
amendment, as it does not address the entire road system.
He emphasized that priorities are established by usage.
In response to Representative J. Davies' question,
Commissioner Perkins stated that the impact would be to the
information services and the procurement division. He
stressed that he did not know the total impact. It is
difficult to assess the impact. Representative J. Davies
asked if the amendment would place specific roads on a
pedestal. Commissioner Perkins agreed that there are
certain roads each year that will be chosen as the
"important ones".
Representative Williams responded that when the add on was
placed in, the Subcommittee was considering the "laundry
list" submitted by the Department. Ms. Slagle acknowledged
that the Department did work with the Subcommittee Chair.
She advised that in the Subcommittee report, Representative
Williams made the decisions as to what to include and what
not to include. The Subcommittee report, it specifically
states that the Subcommittee did reallocate funds from the
Commissioner's Office, upper management, and from support
services to help open up rural roads. Representative
Williams defended his position in determining where the cuts
should be taken from within the Department.
Vice Chair Bunde acknowledged that there are consequences to
the behavior taken by the Legislature. He reminded members
that people do not want taxes, however, want their roads
plowed. He spoke to the reallocations that have been made.
(TAPE CHANGE, HFC 00 - 61, Side 1)
Representative Grussendorf asked how the decisions could be
made, which would shift the impact of the funding cuts. He
recommended an infusion of cash to the Department. He
stressed that it can not come through the Administrative
Services Division.
A roll call vote was taken on the motion.
IN FAVOR: Phillips, Williams, Austerman, Bunde, G.
Davis, Foster, Mulder
OPPOSED: J. Davies, Grussendorf, Moses, Therriault
The MOTION PASSED (7-4).
Representative J. Davies WITHDREW Amendment DOT-1B. [Copy
on File.]
Representative J. Davies MOVED to ADOPT Amendment DOT-2.
[Copy on File]. Representative Williams OBJECTED.
Representative J. Davies explained the amendment.
DELETE:
Administration and Support
Southeast Region Support Services $2,103,000
ADD:
Administration and Support
Southeast Region Support Services $2,135,000
Representative J. Davies stressed that without funding this
amendment; there will be complaints from vendors. He
maintained that the Department of Transportation and Public
Facilities has been cut too much to be accountable for all
the services expected.
Representative Williams responded that the administrative
reductions were discussed with the Department. There
currently are 32 positions located in the Southeast Region.
He indicated that there had been discussion and that there
had been no objection.
Representative J. Davies observed that the reduction may be
the least "objectionable", however, he stressed that there
will be consequences from such a reduction. Representative
Williams acknowledged that the Department did not like the
reduction.
Ms. Slagle pointed out that without the amendment, there
will be an impact to the procurement position and provided
examples of services that would be impacted. Ms. Slagle
commented that this would be a one-position reduction. She
noted that the Department had not agreed to the change.
There were no administrative cuts included on the list
submitted by the Department.
A roll call vote was taken on the motion.
IN FAVOR: Davies, Grussendorf, Moses
OPPOSED: Austerman, Davis, Foster, Phillips,
Williams, Therriault
Co-Chair Mulder and Vice Chair Bunde were not present for
the vote.
The MOTION FAILED (3-6).
Representative J. Davies MOVED to ADOPT Amendment DOT-3.
[Copy on File]. Representative Williams OBJECTED.
DELETE:
Administration and Support
Northern Region Support Services $1,005,60
ADD:
Administration and Support
Northern Region Support Services $1,062,600
Ms. Slagle commented on the impact of the amendment which
would create a 17% reduction to the procurement staff in the
Northern Region. Representative J. Davies pointed out that
without that funding, road maintenance will be slowed down.
Representative Williams noted that he intended to propose an
amendment to add $20 thousand Capital Improvement Projects
(CIP) receipts dollars.
Representative J. Davies WITHDREW DOT-3.
Co-Chair Therriault noted that DOT-3(a) would replace the
previously discussed amendment. [Copy on File]. The
amendment would be in the amount of $30 thousand CIP receipt
dollars.
ADD:
BRU: Regional Support Services
Component: Northern Region Support Services $30CIP Receipts
Representative Williams MOVED to adopt DOT-3(a). There
being NO OBJECTION, it was adopted.
HB 312 and HB 313 were HELD in Committee for further
consideration.
ADJOURNMENT
The meeting adjourned at 11:50 A.M.
H.F.C. 11 3/07/00 a.m.
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